Posted on 03/15/2022 7:42:42 AM PDT by mikelets456
The Wall Street Journal reports active talks between Riyadh and Beijing about pricing some Saudi oil sales to China in yuan instead of dollars.
Chatter about this sort of arrangement has been ongoing for several years, but recent events have brought a new urgency to talks, according to the report, which says the Saudis are questioning longstanding U.S. security commitments to the Kingdom.
Among the issues is what the Saudis believe to be less-than-enthusiastic support for the war in Yemen, the White House's attempt at an Iran nuclear deal, and shock at the American withdrawal from Afghanistan. China is a buyer of more than 25% of Saudi Arabia's exported oil, according to the story.
The news would seemingly be of interest to the Bitcoin (BTC) and gold markets, but, for now, there's little reaction, with bitcoin continuing in the mid-$38,000 area, and gold remaining lower by 2.1% for the day at $1,918 per ounce.
(Excerpt) Read more at msn.com ...
Where’s those 4 FR Neocons who laughed at this and belittled the FReepers stating this could happen?
No, it’s paid for in dollars.
So, countries need to exchange euros for dollars for transfer.
That means the US can control the “value” of the dollar through interest rates and inflation control.
When the oil market is available for purchase in other currencies, countries that trade in that currency dont have to convert to buy oil. Therefore, the banks do t have to hold as many dollars—as they don’t gain you much sitting in a vault (in US treasuries.)
Those banks would sell their dollars, driving up the interest rates. And since the US would have less control over the supply…that interest rate could be sharp.
It means internally, we would be fine. But imports would become very expensive. And we import EVERYTHING.
That is an “explain like I am 5 years old” view of this. There are a lot of other things that complicate it.
But this is what happens when you insult another world leader over and over and over. It gets personal. This is the KSS’s way of saying FJB.
To those with more knowledge, is this basically why its a big deal?:
That the reason we can just print dollars, even though its no longer backs by gold, and not have it become worthless is because all major oil deals have to be done using the US dollar.
Got some rubles, marks, pounds, or yen? Who cares! You can’t buy oil without using the dollar. So if Japan wants to buy oil from the Saudis, it has to first buy American dollars.
This keeps demand for the dollar artificially high which means we can print away. But once the dollar is no longer in demand, if countries move to a different currency for oil...the entire house of cards collapses.
Is that basically the deal?
At least none of their citizens were involved in terrorist attacks on US soil...
There is little doubt that the US Treasury has been politicized and that the unprecedented printing of trillions of paper dollars, non productive spending and the resulting inflation has disconcerted central bankers around the world
. However its a stretch to argue that these bankers will be anxious to substitute yuan for dollars as a mechanism of trade or as their reserves. The value of the yuan is controlled by China’s central bank which is directly controlled by the Communist Party Politburo. They make policy that allocates capital and political decisions, including war that affects the value of the yuan. Would you,after all things are considered put your country’s economic well being in the hands of the Chinese Communist party by holding yuan as a big percentage of your reserve currency?
The arbitrary use of the Western monetary system as a means of punishment is the main turnaway.
What is the point of having dollar denominated assets if they can be confiscated on a whim?
I agree that the Yuan is not the “prettiest girl in the room”, but our policies and making her look better.
I think this is a move by MBS to flip off Biden. He clearly is not a fan.
If this is not getting any attention in DC, then those guys are not really paying attention.
But, money is about efficiency. It will go where it is treated best.
Bingo!
The ability of the US to impose effective sanctions on nations that must use the dollar for commerce or as a reserve currency gives great power to American politicians as Russia, Iran and some individuals around the world have learned. Every time sanctions are imposed or individual accounts are “frozen” or confiscated it does alarm many and further undermines confidence or willingness to invest in dollars.US politicians ought to realize that traditional respect for individual civil liberties and private property resulted in huge amounts of capital from all around the world invested in American properties, securities and bank deposits that heretofore were protected by the US constitution. As the Left gains power in the US, there will be much less of that capital invested here and a lower demand for dollars.
IMHO gold will increase in value and would syrocket if not for the fascination with cryptocurrencies.
Well put Vermont.
The protection of property is so important. And Western governments are flinging it away on a whim. It may take decades to restore that trust.
I heard that non-Russian money was flowing out of London. If that's true, the UK will discover the real cost of those yachts.
Brexit is a good thing in essence, but they mishandled it big time.
20 years ago Germany was a toilet compared to the UK, now the UK is Mexico in comparison.
This left-wing populism from the allegedly conservative Tori party, in combination with the attempt to rebuild an empire in East Europe is going to cost them dearly.
There are freedom fighters in Ireland, Scotland and Wales. If I were Putin, I’d be looking for contacts to bring back that thousands of guns and missiles they sent to Ukraine.
That's ... not the dynamic. This was all better discussed during Brexit, but broadly speaking the English people want independance from them. Scotland in particular is an economic and socialist millstone - a net drain on the UK even when we take North Sea Oil into account.
There'd be a lot of dry eyes in England if Scotland would just leave. But alas, they said 'No' in their referendum.
I'm pushing for English independance. Give us a referendum and see what happens.
You don’t need a majority support to cause mayhem. 2% radicals with weapons are enough.
Biden will get right on that in his second term.
Norse - it’s possible for people to settle their affairs politically without having to shoot their way out.
Resorting to violence before you have exhausted whatever political possibilities exist is generally immoral.
When there is no other choice, then fine - IF those 2% that you mention actually represent the region, and aren’t just imported fighters or unhomogenously-armed groups.
Otherwise you get really, really bad outcomes e.g. like the Bolsheviks, or ISIS. Or the Taliban.
If someone were to arm chosen groups of Scottish separatists, what on earth would be the good? The Scots in general have chosen to stay in the Union. Nobody and nothing is stopping them from leaving.
.
Tell me why shouldn’t Russia want an ISIS-type situation in the UK?
The UK is supporting insurrection in Russia for 25 years and is a major contributor to the hostilities in the Ukraine.
There are freedom fighters in Ireland, Scotland and Wales. If I were Putin, I’d be looking for contacts to bring back that thousands of guns and missiles they sent to Ukraine
Your first sentence mentioned 'freedom fighters' - such a exotic concept when applied to the current members of the UK. It made me miss your second sentence, for which I apologise.
Yes, an enemy of the UK - or the US for that matter, could certainly create mayhem by arming chosen parts of the citizenry.
In the US the Obama regime notoriously armed the Cartels and weaponised them against the US's southern border.
And of course the Dems follow the Venezuelan model of over-arming chosen Police forces while under-policing the criminals - and using government force against political enemies. Such as people who attend School board meetings, yikes.
It's a very good thing that Americans are armed.
I think Russia and allies are pretty much capable to ignite the US as well, but they choose not to, because there is a belief that there are non-neocon patriots who are able to take their country back.
The 2nd Amendment prevents so much grief and horror. Every country should have a version of it.
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